Pretzelmaker

Can you provide details on the 6 litigation cases where the franchisor was defendant, including the nature of claims, outcomes, and whether any resulted in settlements or judgments?

What is the status of the 1 pending litigation case and what are the allegations?

Why has the system contracted by 18 units (11.5%) over the past 3 years, and what is the franchisor's growth strategy to reverse this trend?

Given the 9.3% annual closure rate, can you identify the primary reasons franchisees are exiting (e.g., profitability issues, location challenges, market saturation)?

Gross sales averaging $559,357 are significantly below typical QSR franchise performance. What are the unit economics, and what profit margins are franchisees typically achieving?

Your royalty rate of 7% is above the typical 5-6% range for QSR franchises. How does this compare to direct competitors, and is there flexibility in negotiating this rate?

The technology fee of $70/month is substantially lower than typical ($110-408). Does this cover all required technology systems, or are there additional software/equipment costs franchisees must absorb?

The franchise agreement requires binding arbitration in Los Angeles. What happens if a franchisee cannot afford to travel for arbitration, and are virtual proceedings available?

The agreement lists 16 non-curable defaults versus only 1 curable default category. Can you specify which default categories allow a cure period and which do not?

Personal guarantees are required from franchisees and their spouses for all obligations. Can this guarantee be limited in scope or amount, or is it mandatory as written?

The total potential contract term is 35 years (15 initial + 2 x 10 renewal). What triggers renewal, what is the renewal fee ($10,000 stated), and can terms be modified at renewal?

Territory is designated as non-exclusive with no encroachment protection. Does this mean the franchisor can open competing units near your location, and if so, how close?

With a 5-day cure period for payment defaults and 10-day maximum for other defaults, how much advance notice do franchisees receive before notice is delivered?

Can you explain the Support & Training score of 80 (below the 90-100 typical range) and what specific training and ongoing support gaps may exist?

What is driving the System Health score of 32 (significantly below the typical 50-75 range), and what operational issues does this indicate?

Are there any Item 19 financial performance claims or AUV data available that would help assess realistic profit potential for new franchisees?

Of the 7 unit transfers in the past year, what were the sale prices and did the franchisor approve/facilitate these transactions?

Given the pending litigation case, is there any business interruption risk, potential liability exposure, or operational changes that may result from the lawsuit?

What market conditions or competitive factors are driving the net -5.15% unit growth in the past year, and has the franchisor adjusted its support or marketing strategy in response?

The termination rate is 0% and non-renewal rate is 0%, which suggests all exits are voluntary. Do you actively encourage struggling franchisees to exit, or do you have a turnaround support program?